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- The future of payments is contactless – and likely soon cardless.
- Most entry-level smartphones allow you to do this using banking apps or mobile wallets.
- If you'd prefer to keep your phone and wallet pocketed, an NFC-compatible watch is the way to go.
- We look at the cheapest options available in South Africa.
- For more stories, visit the Tech and Trends homepage.
The present and future of in-store payment is undeniably contactless – and soon likely cardless too.
In January this year, FNB said only 1% of its credit card and Fusion account holders were swiping or inserting physical cards. The bank also said contactless payments accounted for more than 60% of transactions.
And even before the latest surge, a Mastercard study suggested that up to three-quarters of South Africans were using contactless payments, citing safety and cleanliness. And in a single quarter in 2021, Mastercard processed one billion more contactless transactions globally than the previous year.
Although it's possible to complete a contactless payment with a compatible bank card, using a smart device is far quicker and easier, and has additional security layers. But it also requires you to fork out for a smart device, like a smartwatch, which isn't cheap.
Benefits of smart devices for contactless payments
Using a smartwatch or smartphone to complete your purchase does have marked benefits.
Unlike contactless payments using cards, most digital wallets on smart devices don't have fixed thresholds, after which you'll have to enter your PIN anyway.
Instead, your face or fingerprint takes care of the PIN, meaning you won't have to interact with the grimy card machine the next time you fill up your car.
Smart device contactless payments have other features that make them safer than chip and PIN cards. Fingerprint or facial recognition measures aside, digital wallets like Apple Pay or Google Pay add security layers through encryption and tokenisation.
And naysayers concerned about errant taps on their cards may feel more secure in the knowledge that they have to approve it on the device – and that point-of-sale machines won't allow repeat payments for the same transaction in a short period of time.
Most cardmakers also have clauses that allow for the automatic refund of money in the rare instances of double deductions.
Although no payment method is entirely immune to hackers – particularly when it comes to social engineering – using a phone or watch may be the quickest and safest way to complete a payment. And the easier it is to complete a payment, the more likely you are to shop and spend, which is why banks and retail outlets are also so excited to add these tools to their arsenals.
What you need in a smartwatch for contactless payments
If you're sold on the idea and like leaving your wallet and phone in your pocket, you'll need a smartwatch that supports near-field communication (NFC).
NFC allows your watch and a point-of-sale device to communicate when about 10cm apart. With NFC enabled, you'll also need a digital wallet that stores your card details and activates payments.
READ MORE | Why most virtual bank cards are safer and more practical than physical cards
Apple Pay and Google Wallet are the dominant global players, but Garmin, Fitbit and Samsung also have in-house "pay" products.
Each wallet app links directly to a device and is brand-specific, except for Google Wallet, which works across several Android devices.
Lastly, you'll need to work with a bank that supports this technology. South Africa's biggest banks now support digital wallets, including FNB, Standard Bank, Nedbank, Capitec and Absa.
Here are some of the cheapest watches across all categories among leading brands available in SA
If all you want to do is make payments, and you bank with FNB, you can get away with spending R1 900 on a watch with minimal functionality.
One step up are various entry-level fitness trackers with a few more features, starting at about R2 200.
And if you're loyal to brands like Apple or Samsung, you'll likely have to pay a bit more – though tap-to-pay is no longer the domain of their flagship models. And these watches typically come with a raft of other features.
Cheapest overall:
- SwatchPAY!, R1 900
Swatch wins the title of the cheapest tap-to-pay watch on the market, starting at just R1 900. But it comes with several limitations, most notably, SwatchPAY! watches are currently only compatible with FNB in South Africa.
That's because these aren't smartwatches. Instead, they're typical Swatch watches that contain passive NFC chips, which means they're better thought of as a watch hiding a tiny bank card, which, at best, is useful for an emergency payment when you forget your wallet.
Cheapest smartwatch:
- Fitbit Charge 4, R2 195
For just R300 more, you can pick up a Fitbit that is a lot smarter, if somewhat less visually appealing, than the SwatchPAY!
In 2018, Fitbit was among the first companies to enable contactless payments in South Africa with its Fitbit Pay service. Today, you can use the Charge 4 for contactless payments if you bank with Discovery Bank, Standard Bank, Absa, FNB, RMB Private Bank and Investec Private Bank.
Cheapest Samsung Watch:
- Samsung Galaxy Watch Active2 (40mm), R2 799
The Samsung Galaxy Watch Active2 works with Samsung Pay and appears online for as little as R2 799. It's currently the cheapest Samsung Galaxy watch with NFC compatibility but has previously retailed for up to R3 999. Samsung Pay is compatible with many local banks, including Absa, Standard Bank, FNB, RMB Private Bank, Discovery Bank, Investec Private Bank, Nedbank, Capitec and African Bank.
Cheapest Apple Watch:
- Apple Watch SE (2022): R4 999
The 2022 Apple Watch SE (40mm) is the cheapest in the Apple Watch range that you might still be able to find online. Stock is low, but it's possible to pick up deals on this model for around R5 000. If you're forced to level up to the new SE, you're looking at R6 299 for the cheapest new model.
